DEF: My Size, Inc. Seeks Shareholder Approval for Director Elections and Significant Equity Plan Expansion

My Size, Inc. has issued its definitive proxy statement for its Annual Meeting on September 4, 2025, seeking shareholder approval for the re-election of two Class I directors, a substantial increase in its 2017 Equity Incentive Plan share reserve, and the adoption of an evergreen provision for future equity awards.

Summary

• An Annual Meeting of Stockholders will be held on September 4, 2025, at 10:00 a.m. local time in Tel Aviv, Israel.
• Shareholders will vote on the election of Arik Kaufman and Roy Golan as Class I directors for a three-year term.
• A proposal seeks to amend the My Size, Inc. 2017 Equity Incentive Plan to increase the common stock reservation for issuance from 130,000 shares to 756,691 shares.
• Another proposal aims to adopt an evergreen provision for the 2017 Plan, automatically increasing the share reserve annually from January 1, 2026, to January 1, 2029, by the lesser of 5% of outstanding common stock or a board-determined smaller number.
• Shareholders will also vote to ratify the appointment of Somekh Chaikin as the independent public accountant for the fiscal year ending December 31, 2025.
• The board of directors unanimously recommends a vote FOR all four proposals.
• As of July 8, 2025, there were 3,103,076 shares of the company's common stock issued and outstanding.
• Net loss decreased from $6,380,000 in fiscal year 2023 to $3,995,000 in fiscal year 2024.
• The cumulative total shareholder return (TSR) for a $100 investment made on December 31, 2022, was $199 at December 31, 2023, and decreased to $157 at December 31, 2024.

Sentiment

Score: 6

Explanation: The document is primarily a proxy statement for routine corporate governance matters and equity plan adjustments. The significant reduction in net loss is a positive financial indicator, suggesting improved operational efficiency. However, the negative trend in Total Shareholder Return (TSR) and the potential for dilution from the evergreen equity plan temper the overall sentiment. The proposals are generally aimed at long-term talent retention and operational continuity.

Positives

• The company's net loss significantly decreased from $6,380,000 in fiscal year 2023 to $3,995,000 in fiscal year 2024, indicating improved financial performance.
• The proposed increase in the 2017 Equity Incentive Plan share reserve and the adoption of an evergreen provision are intended to attract and retain key personnel, which is crucial for long-term growth and success in a competitive labor market.
• The board of directors recommends approval of all proposals, signaling confidence in the strategic direction and governance measures.
• The company has implemented robust corporate governance policies, including a Code of Business Conduct and Ethics, an Insider Trading Policy, and an Executive Officer Clawback Policy, enhancing accountability and compliance.

Negatives

• The cumulative total shareholder return (TSR) for a $100 investment on December 31, 2022, decreased from $199 at December 31, 2023, to $157 at December 31, 2024, indicating a decline in shareholder value over the most recent period.
• Compensation actually paid to the Principal Executive Officer (PEO) decreased from $537,307 in fiscal 2023 to $526,822 in fiscal 2024.
• Average compensation actually paid to Non-PEO Named Executive Officers (NEOs) decreased from $377,448 in fiscal 2023 to $337,816 in fiscal 2024.

Risks

• There is an insufficient number of shares remaining under the current 2017 Equity Incentive Plan to meet projected needs, which could impair the company's ability to attract and retain key personnel if the proposed amendments are not approved by stockholders.
• The evergreen provision for the 2017 Plan, if approved, has no explicit limit on the total number of shares that may become available for issuance, potentially leading to significant future dilution for existing shareholders.
• The enforceability of non-competition provisions in executive employment agreements may be limited under applicable law, which could impact the company's ability to protect its interests if executives depart.

Future Outlook

The company expects the proposed Evergreen Provision under the 2017 Plan to provide enough shares for awards for approximately four years, assuming current granting practices and historical usage, maximum annual evergreen increases, and further dependent on the future price of shares and hiring activity. However, the company cannot predict future equity grant practices, share prices, or hiring activity with certainty, and the share reserve could last for a shorter or longer time.

Management Comments

• "Because of the significance of these proposals to the Company and its stockholders, it is vital that every stockholder votes at the Annual Meeting in person or by proxy."
• "We believe that operation of the 2017 Plan is a necessary and powerful tool in attracting and retaining the services of key employees, key contractors, and outside directors in a competitive labor market, which is essential to our long-term growth and success."
• "We also need to ensure that we can continue to provide an incentive to our current employees, contractors and outside directors, many of whom hold outstanding options that were previously awarded under the 2017 Plan with exercise prices above the current fair market value of our common stock."
• "We strongly believe that evergreen proposal is essential to our continued success and therefore is in the best interests of the Company and our stockholders, since it allows us to annually maintain a sufficient number of shares of common stock issuable under the 2017 Plan, which is necessary for us to be able to provide our employees with sufficient award grants under the 2017 Plan to incentivize them to work with the Company and to maintain their services."

Industry Context

The document highlights the company's need to attract and retain key talent in a competitive labor market, a common challenge in the technology sector. The reliance on equity incentive plans, including a proposed evergreen provision, aligns with industry practices to incentivize employees and align their interests with long-term company performance. The company's operations in retail technology and AI deployment, particularly through its subsidiary Naiz Fit, position it within a dynamic and evolving market segment where innovation and skilled personnel are critical for success.

Comparison to Industry Standards

• The company's classified board structure with staggered three-year terms is a common corporate governance practice, though some institutional investors and governance advocates prefer annual elections for all directors to enhance accountability.
• The proposed increase in the 2017 Equity Incentive Plan share reserve to 756,691 shares and the adoption of a 5% evergreen provision are significant. While equity compensation is standard in the technology industry to attract and retain talent, the potential for ongoing dilution from an uncapped evergreen provision warrants careful consideration compared to plans with more defined limits.
• The reduction in net loss from $6.38 million in 2023 to $3.995 million in 2024 indicates an improvement in financial efficiency, which should be benchmarked against the profitability trends of comparable companies in the retail technology or AI solutions space.
• The decline in Total Shareholder Return (TSR) from $199 to $157 (based on a $100 initial investment from December 31, 2022) suggests underperformance relative to a hypothetical benchmark, necessitating a detailed comparison against relevant industry indices or direct competitors' stock performance over the same period.
• The executive compensation structure, including base salary, bonus, stock awards, and option awards, is consistent with typical practices in publicly traded technology companies. The inclusion of 'Managers Insurance' and 'Education Fund' as social benefits reflects customary employment practices in Israel, where the company is based.

Management Changes

Corporate Governance

Legal Proceedings

• The company is not aware of any of its directors or officers being involved in any legal proceedings in the past ten years relating to bankruptcy, insolvency, criminal proceedings (other than traffic and other minor offenses), or being subject to any of the items set forth under Item 401(f) of Regulation S-K.

Related Party Transactions

• Ronen Luzon (Chief Executive Officer and Director) and Billy Pardo (Chief Operating Officer and Chief Product Officer) are husband and wife.
• The company has entered into written employment agreements with each of its executive officers, including Ronen Luzon and Billy Pardo, detailing their compensation and benefits.
• Options and restricted stock awards have been granted to officers and directors since the company's inception, which may contain acceleration provisions upon certain merger, acquisition, or change of control transactions.
• An agreement was entered into with Accounting Team Ltd., an entity 100% owned by Oren Elmaliah (Chief Financial Officer), for bookkeeping, controller, and CFO services, with a monthly fee of NIS 63,000 (approximately $18,000).

Stakeholder Impact

• **Shareholders**: Will be directly impacted by the outcome of the votes on director elections and the significant expansion of the equity incentive plan, which could lead to potential dilution of existing shareholdings. The decline in TSR indicates a negative impact on shareholder value in the recent period.
• **Employees/Executives**: Directly benefit from the equity incentive plan, which provides compensation and incentives for their performance and retention. Management changes affect specific individuals and their roles within the company. The clawback policy introduces a layer of accountability for executive compensation.
• **Customers/Suppliers**: While not directly addressed, the company's ability to attract and retain key talent through its equity plans could indirectly influence its capacity for innovation, product development, and service delivery, potentially impacting customer satisfaction and supplier relationships.
• **Creditors**: Not explicitly mentioned, but the reported reduction in net loss could indirectly signal improved financial health, potentially enhancing the company's creditworthiness.

Next Steps

• Stockholders are urged to vote on the proposals at the Annual Meeting on September 4, 2025, either in person or by proxy.
• The company intends to begin sending the Notice of Internet Availability of Proxy Materials to stockholders on or about July 11, 2025.
• Stockholders will receive instructions on how to access proxy materials online or request paper copies.
• If stockholders do not approve the selection of Somekh Chaikin as the independent registered accounting firm, the audit committee will reconsider the appointment.
• Stockholder proposals for inclusion in the 2026 annual meeting proxy materials must be received by the corporate secretary on or before March 11, 2026.
• Director nominations or other business proposals for the 2026 Annual Meeting (not included in proxy materials) must be submitted between May 7, 2026, and June 6, 2026.
• The evergreen provision for the 2017 Plan, if approved, will automatically increase the share reserve annually from January 1, 2026, to January 1, 2029.

Key Dates

Keywords

Proxy Statement, Annual Meeting, Equity Incentive Plan, Stock Options, Corporate Governance, Director Election, Shareholder Approval, Executive Compensation, SEC Filing, My Size Inc, Nasdaq, Financial Reporting, Risk Management, Strategic Business Analysis, Share Dilution, Net Loss